Online banking has now become an alternative, if not a better one, to going to the bank physically to transact business.

A Business World Online poll shows that more than 70% of the respondents are using internet banking. The number of users who use the internet for banking outnumbered users who opt for other e-banking channels such as telephone and mobile phone. The online poll defined e-banking as the different channels which enable users to transact with the bank. By this definition, automated teller machines (ATMs) were included in the online survey. Through its online newspaper, the Business QUESTION: Do you e-bank? World Internet Edition (BWIE), Business World Online conducted an interactive poll from June 4 to July 4 on the e-banking preferences of customers of banks in the country. The online poll supports another BWIE survey of banking practices in the Philippines. The banking survey, on the other hand, assesses the most common practices of Philippine banks, with a special focus on e-banking. While the banking survey attempts to be a scientific study, the online poll is an informal study involving readers of Business World Online web sites. The poll is an attempt to get banking customers preferences for e-banking. CHANNELS The online poll asked Business World readers to choose the "most convenient" means for them to transact with their bank, or to "e-bank". They were made to choose either the internet, telephone, mobile phone, over-the-counter or the ATM. A total of 194 out of 428 respondents or 45.327% said they prefer to transact through the internet. In contrast, 22.43% of respondents said they still prefer the ATM to transact while another 15.421% said they prefer phone banking. The next most convenient means for the respondents to transact is through mobile phones. Not surprisingly, 5.841% of the respondents said they still prefer to transact with their bank physically, or over the counter.

QUESTION: Which is the most convenient way for you to e-bank?

Carter G. Yu, 23, general manager of a video production firm and a regular e-banking user, said he hardly ever goes to the bank, except when he has to deposit money. Other than this, he uses the other e-banking channels to transfer funds between accounts and pay his bills. The same is true for Jenny (not her real name) who works for a top international bank. To withdraw money, Jenny said she uses the ATM. However, internet banking is the most convenient way for her to pay her bills and transfer funds, without having to queue and make the effort to travel to her bank branch. She said the only time she goes to the bank is when she has to deposit funds. Business World On lines poll results support government data which indicate that internet banking is the most preferred type of e-banking services offered by Philippine-based banks. Data from the Bangko Sentral ng Pilipinas (BSP) show that as of March 2003, the most common type of e-banking service offered by Philippine banks is internet banking. The report indicated that 21 out of the 30 banks which have been approved by BSP to offer ebanking services offer these through the internet. Meanwhile, 17 offer electronic banking services through fixed line telephones, and 16 through mobile phones. BSP also authorized seven banks to participate in the electronic tax filing and payment system (EFPS) of the Bureau of Internal Revenue (BIR). EFPS makes available online the filing of quarterly income tax return for corporations and partnerships as well as payment of tax due for every fiscal year. Online banking users interviewed by Business World Online find online banking convenient instead of queuing in a bank branch. Most Business World Online respondents who already e-bank say that they use the facility to pay for their bills. Respondents were asked how they use e-banking and given choices between transferring funds, balance inquiries, pre-paid card reloading, bills payment, loan application and investments.

Caryl A. Aglian, 20, a college graduate is already banking electronically through the internet. She said she uses internet banking to pay her bills and online purchases. The online poll indicates that 53 out of 168 respondents or 31.548% said use e-banking to pay for their bills. This feature of e-banking allows users to pay for their bills instantly without having to go the bank or write checks.

QUESTION: How Graphics by Crecencio I. Cruz

do

you

e-bank?

Another 14.880% or 25 of the total respondents said that they use e-banking to transfer funds. Fund transfer is similar to the bills payment procedure where bankers can move funds from one account to another without having to physically write an instruction to do so. Meanwhile, many e-banking users also use the channels to inquire about their accounts. A total of 46 or 27.380% said they use e-banking channels to check their account balances. Less than 10% of the respondents said that they use e-banking channels to reload their pre-paid cellular phone subscription. Currently, only a few banks offer this kind of service to their banking clients. WHY E-BANK? Many e-banking users prefer to use the electronic means because of convenience and mobility. Through e-banking, bank accounts can be accessed by users more often, at their own convenience. More so, banking transactions can be made from home, office or even abroad. A study by AC Nielsen Consult confirmed growth in the number of online bankers. An estimated 34% or 330,000 of all regular internet users in the country, or those who log online at least once a week, are also online bankers. Elena P. Van Tooren, MIS director of AC Nielsen said in an earlier email interview that regular internet users are ready, in terms of access availability and frequency of use, in conducting activities online. Despite this, a large percentage of the online poll respondents still do not have e-banking access.

The BusinessWorld online poll results show that 46.428% of the respondents confirmed that their most valid reason for not banking electronically was that they do not have access to ebanking. E-BANKING SECURITY Still, many people have qualms about banking electronically because of security. In some cases, other e-banking channels are preferred over the others because of perceived levels of security. Poll results also show that 31.493% or 97 out of 308 respondents said that they do not trust ebanking. Lesley T. Chuayap, 23, an office clerk said that she will only use e-banking services when the need arises and if it is convenient for her. She added that most importantly, security assurance will make her decide to finally start to e-bank. Similarly, bank customers interviewed by BusinessWorld Online said that they prefer to use other channels than the internet because of fear of failure in the security measures that online banks take. Standards have been placed in many online banks such as 128-bit SLL encryption, multiple firewalls and user IDs with passwords to ensure safety of transactions. Kryzchelle A. Aglian, 24, a businesswoman feels that banking through the telephone is more secure than using the internet. She points out that data can only be retrieved by the account holder in the phone banking channel while the internet is subject to hacking. Mr. Yu has similar apprehensions about the internet and prefers to use phone banking. He said the phone has lesser chances of getting hacked compared to the internet, while mobile phones sometimes fail because of network problems.

QUESTION: What is the most valid reason why you have not tried ebanking? Graphics by Cresencio I. Cruz OTHER REASONS

The online poll shows that 13.311% of respondents said that they do not have enough funds to start e-banking. Niven Dioquino, 25, video editor, said that he feels that his funds are not enough to start ebanking. When the need arises however, he said that he is willing to try all three channels for ebanking. The AC Nielsen online banking summary indicates that 15% the regular internet users who are not yet banking online can not wait to try it out while 56% are willing to try it in the future. Only a small percentage of the respondents or 6.169% said that e-banking is not available at their banks. The BusinessWorld Online poll shows bank customers use online banking becuase they value convenience and mobility. However, security and assurance are still issues that banks need to address. Some e-banking customers interviewed said they do not feel that they are well informed about the services that their banks are offering. Some bank executives interviewed by BusinessWorld Online said they are aware of these issues raised by their customers. Some banks, for instance, have made it a policy to inform their customers of security measures they have undertaken. Currently, online banks are using industry standards such as 128-bit SSL encryption technology and firewalls to prevent any unauthorized access to bank accounts online. Still, these safety measures are not fail-proof and will need to be looked into as computer technology and even hacking techniques become better in the future. Some banks even employ teams of computer specialists to try to hack into their systems to make sure that security measures that they have taken do not fail. Christina B. Goco, Vice President for product management-wholesale bank of the Standard Chartered Bank said the said bank runs intrusion tests for their online banking web site. Even with the security measures taken by online banks, some bank customers can not help but be paranoid with the idea of transacting through the internet. With this, taking steps to secure online transactions is not enough, banks will need to take information disemmination further to keep customers confident with online banking.